How do I make sure that a product is fair trade?
Whole chain is the solution
What exactly is fair-trade, and how do you ensure that the dress, shoes, coffee or soap you buy is fair-trade. Honestly made under good working conditions in which everyone profits in a fair manner from the product. Dif’s Carien Neeleman presents three examples of companies who are implementing fair-trade in their whole chain.
What is Whole Chain entrepreneurship?
Fair-trade has become a loaded term. Where the term was sparsely used by eco warriors at the start of the century, now its become a marketing friendly term with increasing popularity.
But like all marketable things it is also seemingly cheapened. On the one hand because it is often unjustly used, and on the other hand because there is little in the wat of regulations and certifications to exert some control.
Certification through a fair-trade logo has two issues. First is the rampant growth of certifications and the corruption that comes with that. Second is that guaranteeing fair-trade standards in the whole production chain is nigh impossible for some products. A phone for example, made up of multiple components, involves hundreds of companies with multiple production steps. If you want that phone to be ‘fair’ you need to inspect all those involved on their wages, working conditions, child labour, etc.
There is more and more attention in the circular economy for a new phenomenon called ‘the whole chain’. Companies that adhere to this concept try to get control over all phases of the creation process. This is a lot easier for some products than others however. The above mentioned Fairphone for example, goes to extreme lengths to ensure fair working conditions and wages. And even then they have noted that ensuring 100% fair conditions for all suppliers is currently impossible, especially in the mining industry. To remedy this they’ve created a matrix which will do research towards the circumstances of these suppliers. Other companies have an easier time, because of the simpler composition of their product (e.g. the coffee bean)
Dr. Bronner’s Magic Soaps”
Soap with a message
The first thing you’ll notice with Dr Bronner soap are the labels. In a tiny font there are encouraging messages such as ‘Be an engine for positive change, share profits, share talent, share muscle, share voice.’ The message of Dr. Bronner is clear: We are all one! David Bronner, the grandson of the original founder, completely supports this message. “We use our soap activities to create positive social and ecological change in the world. All profit that isn’t necessary for our company goes to charities around the globe.’’
Emanuel Bronner, the founder of ‘Dr Bronner’s magic soaps’ was ahead of his time when he founded his company in California in 1948. As a 21 year old Emanuel fled Nazi Germany and his fathers soap factory in 1929. From there he devised a plan for world peace, which he called the “moral ABC”. The labels on his bars of soap where used to spread this ‘We are All-One’ message.
“The lasting legacy of my grandfather is the ‘All-One’ moral philosophy that can be seen on our labs and the progressive soap industry he built.’’ Says David Bronner, the grandson of the founder, who runs Dr. Bronner together with his brother Mike.
It’s no wonder that Dr Bronner’s soap in ecological, vegan, cruelty-free, and biodegradable. The ingredients are 95 percent sourced from their own production chain. Their philosophy is that what you don’t handle yourself you can’t ensure where its from. Dr Bronner is also a B Corp (Benefit corporation) which combines people, planet, and profit in a holistic way.
Dr Bronner has initiated small scale fair-trade and ecological projects around the globe. E.g. Sri Lanka and Samoa for coconut oil, Ghana for palm oil, Palestina and Israel for olive oil, India for mint oil, Ecuador for palmpit oil, and India and Brazil for Sugar. David Bronner: “We have a special team at Dr Bronner, which directly cooperates with farmers and producers locally. That way we can help implement ecological agricultural methods and support fair practices in wages and infrastructure.” It is estimated that over 10.000 people worldwide profit directly from Dr Bronner’s fair-trade projects.
The Philanthropical ideas from their grandfather can also be found in the way they run their business in the United States. Over 200 employees in the US receive up to 25% more than what is standard for their field of work, and they have free private healthcare. Those in management have their waged capped at a maximum of five times the lowest salary. The family owned business has a yearly revenue of 111 million dollar.
Breeding a new breed of goats for the lower mountain regions in Nepal, that is one of the goals of the international cooperative SoGoodToWear. Since 2015 SoGoodToWear has worked on improving the living and working circumstances of the inhabitants of Gurkha, a region heavily affected by earthquakes. They do this by reviving the withered cashmere industry in Nepal. The sixth collection of cashmere basics by SoGoodToWear has just hit shelves in Europe
The founders of SoGoodToWear are Fons and Jacqui Burger. The idea to start a cashmere company in Nepal came to be in 2014. “We traveled through Nepal and came to Gurkha. A beautiful but rather poor mountainous region. Men left for India or Qatar to make a living. The level of illiteracy was astoundingly high. We looked for a way to create lasting working opportunities, but there were no initiatives we could support. But there were plucks of cashmere wool in the bushes. So the idea was born to resurrect the lost cashmere industry in Nepal”, so tells Jacqui.
The processing chain for cashmere is actually still intact in Nepal, the only things missing are the cashmere goats. With crowdfunding Fons and Jacqui Burger collected 50.000 euros to source cashmere goats from Italy. Jacqui: “With an ingenious breeding program we’ll bring the cashmere goat back to Nepal. Small locally owned herds are key to ensuring the fair-trade production chain and to provide local families with an income. Last month we purchased 6 Australian bucks and goats. Together with The Wageningen and Kathmandu University we are working on breeding a race of goats that can survive in the mountainous regions while providing A grade cashmere. This way we can later expand to other regions in Nepal.”
SoGoodToWear is currently an international cooperative, but aspires to become a B corp in the future. “We want to be a fair chain company. Everything needs to be right in the chain: from a happy goat to a satisfied farmer and consumer. Human and nature are central to us. This means, among other things, animal friendly herding, having an in-house spinners and weaving mills, providing education, training, and a good salary for our herders and spinners. All profit is reinvested into the cooperative. Ou dream is to have our basics sold worldwide and that there are small scale herds across Nepal, providing an abundance of cashmere wool.”
Currently SoGoodToWear imports its cashmere wool from a animal friendly farm in China. “Unfortunately we can’t go to China to ensure they are truly animal friendly, which only stresses why it’s so important to have our own herds. That way we can provide for a lot of families while ensuring the integrity our production chain.”
Moyee Coffee, Radically transparant
Have you too always been under the impression that your daily cup of ‘Max Havelaar’ coffee helped poor farmers in developing countries to build a better existence? That fair-trade is the way to support developing countries? Well, you’re wrong. The coffee sector encompasses 80 billion dollars annually. Only 17 million comes from fair-trade. That’s 0,002 percent. The majority of money in coffee disappears into the coffers of a handful of multinationals who have used their 80’s mentality and profit maximisation to extort poor farmers. From entrepreneur Guido van Steven van Dijk these numbers were a reason to start the first fair chain coffee company in 2012; Moyee coffee.
Moyee Coffee focuses on the whole chain, from bean to roasting to the sales. “That is where the real money is and where the difference can be made for developing countries”, says Guido. With Moyee he wants to reinvent the whole chain. “Were aiming for a 50/50 split, where half the profits are made in the producing country and half in the consuming country.” It is Ethiopia, the motherland of the Arabica bean, that the first Moyee coffee roasting factory is placed. Since this year the company is also active in Kenya and Colombia.
Moyee Coffee is radically transparant. “We use technology to go from story telling to story proving. It is all about measurable proof of the impact”, so says Guido. Last year Moyee started with a blockchain experiment. By making the whole production and sales project visible online through blockchain, he shows exactly how much Ethiopian farmers make from Moyee products sold in Europe. To make sure this all actually has an impact on living conditions of the coffee farmers there is now a study into this linked to the blockchain.
With online sales the company had realised a 3 million revenue in 2018. They don’t do marketing at Moyee Coffee. No George Clooney or other expensive ad campaigns. The money they save there is used by Moyee to invest in another blockchain experiment: The Moyee token; their own crypto coin. With each bag of coffee you get a token valued at 50 cents. This digital currency can then be used for discounts, reinvested in the company, or using it as a tip for the farmer in Ethiopia.